STOCK EXCHANGE IN QUANDARY

Press, Volume XCVII, Issue 28629, 4 July 1958, Page 13

STOCK EXCHANGE IN QUANDARY

“Cannot Give Lead To Investors” It is not possible, in the unsettled state of the country at present, for the New Zealand Stock Exchange to give a lead to Dominion investors, said the president of the Stock Exchange Association of New Zealand (Mr J. H. Griffiths) in a statement yesterday. “The Minister of Finance (Mr Nordmeyer), has announced his Budget, but we want to make it clear to the general public thatthe provisions of the Budget are not law and will not be law until such time as the validating legislation has been passed. ‘‘ln view of the fact that the Leader of the Opposition has stated that he will fight the provisions of the Budget tooth and nail it will be some time before it will be possible for us to give a lead to the investing public. General Marking Down

“Generally speaking, however, the application of the Budget provisions must mean a marking down of all New Zealand securities with a consequent heavy loss of capital to small and large investors alike.

“There are companies in New Zealand where the shares are held by a few but, in the majority of public companies in which the general public usually invests, there are many shareholders with small holdings. “We urge the Government to reconsider the double taxation of shareholders and also to give urgent consideration to dropping the proposal of a 50 per cent, dividend payout. “It is possible that in certain instances relief may be granted from this mandatory figure, but presumably this could only be obtained by going cap-in-hand to some Government official to explain a policy which the shareholders’ representatives, namely the directors, have decided to be in the best interests of the company.

“In view of the unsettled position at the moment, it is not possible for us to give a true indication of the value of New Zealand securities.” concluded Mr Griffiths.